New Customs levy cuts rebates to lines at Kochi port
Shipping lines calling at Kochi Port may not get the benefit of some concessions now being offered by the port management to attract more vessels, reported The Hindu.
This is because, Kochi Customs’ decision to collect Indian Light House (ILH) dues for on-deck cargo on all vessels calling at the port has effectively nullified the tariff reduction measure of the port.
In fact, the Customs levy has virtually taken away the sops offered by the port management to attract vessels, shipping sources say.
The port management is currently offering 86 per cent rebate in vessel-related charges to mainline vessels and 30 per cent to feeder vessels in order to attract more ships to dock at the port.
But the ILH levy has forced shipping lines to spend additional money for each port of call, the sources said.
The ILH dues are now being collected on the basis of the NRT (Net Register Tonnage) of vessels entering Indian ports. The new levy was a statutory requirement under the Light House Act, 1927.
Though Kochi Port was excluded from the decision for the time
being, the authorities have now started to collect such a fee from vessels.
NRT is a ship’s cargo volume capacity expressed in “register tonnes”, one of which equals to a volume of 100 cubic feet. It is calculated by reducing non-revenue-earning spaces — spaces not available for carrying cargo, for example engine rooms, fuel tanks and crew quarters — from the ship’s Gross Register Tonnage.
A mainline vessel with a carrying capacity of 6,400 TEUs and NRT of 42,929 tonnes will have to pay an additional amount of approximately about US$1811 as dues for on-deck tonnage.
Besides, ILH dues at 14 cents 8 per NRT, will be around $6,219 or more depending on the size of the vessel. Hence, the total payment towards ILH dues alone will be around $8,000 for each call.
This additional burden, according to sources, has been thrust upon the shipping trade at Kochi, which is already in dire straits due to recession and also the high handling rates compared to other neighbouring ports and other transhipments hubs.
They were of the view that these additional costs will discourage new operators from using the Kochi port, resulting in a further drop in traffic.